Correlation Between Pimco Short and High Yield
Can any of the company-specific risk be diversified away by investing in both Pimco Short and High Yield at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Pimco Short and High Yield into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Pimco Short Asset and High Yield Fund, you can compare the effects of market volatilities on Pimco Short and High Yield and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Pimco Short with a short position of High Yield. Check out your portfolio center. Please also check ongoing floating volatility patterns of Pimco Short and High Yield.
Diversification Opportunities for Pimco Short and High Yield
0.4 | Correlation Coefficient |
Very weak diversification
The 3 months correlation between Pimco and High is 0.4. Overlapping area represents the amount of risk that can be diversified away by holding Pimco Short Asset and High Yield Fund in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on High Yield Fund and Pimco Short is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Pimco Short Asset are associated (or correlated) with High Yield. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of High Yield Fund has no effect on the direction of Pimco Short i.e., Pimco Short and High Yield go up and down completely randomly.
Pair Corralation between Pimco Short and High Yield
Assuming the 90 days horizon Pimco Short is expected to generate 1.79 times less return on investment than High Yield. But when comparing it to its historical volatility, Pimco Short Asset is 2.63 times less risky than High Yield. It trades about 0.23 of its potential returns per unit of risk. High Yield Fund is currently generating about 0.16 of returns per unit of risk over similar time horizon. If you would invest 586.00 in High Yield Fund on September 2, 2024 and sell it today you would earn a total of 93.00 from holding High Yield Fund or generate 15.87% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Pimco Short Asset vs. High Yield Fund
Performance |
| Timeline |
| Pimco Short Asset |
| High Yield Fund |
Pimco Short and High Yield Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Pimco Short and High Yield
The main advantage of trading using opposite Pimco Short and High Yield positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Pimco Short position performs unexpectedly, High Yield can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in High Yield will offset losses from the drop in High Yield's long position.| Pimco Short vs. Aqr Managed Futures | Pimco Short vs. Blackrock Inflation Protected | Pimco Short vs. Western Asset Inflation | Pimco Short vs. Ab Bond Inflation |
| High Yield vs. Bbh Intermediate Municipal | High Yield vs. Dreyfusstandish Global Fixed | High Yield vs. Multisector Bond Sma | High Yield vs. T Rowe Price |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Balance Of Power module to check stock momentum by analyzing Balance Of Power indicator and other technical ratios.
Other Complementary Tools
| Portfolio Suggestion Get suggestions outside of your existing asset allocation including your own model portfolios | |
| Portfolio Holdings Check your current holdings and cash postion to detemine if your portfolio needs rebalancing | |
| Companies Directory Evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals | |
| Commodity Directory Find actively traded commodities issued by global exchanges | |
| Portfolio Comparator Compare the composition, asset allocations and performance of any two portfolios in your account |